Contracts for new, single-family home sales declined in June, falling -5.3% to a 631,000 seasonally adjusted annual rate according to estimates from the joint release of HUD and the US Census Bureau Wednesday last week. The decline came off a downwardly revised May estimate, which was dropped from an initial read of 689,000 to a new estimate of 666,000.
US Home Ownership, New Home Sales
According to the US Census Bureau’s Housing Vacancy Survey (HVS), released Thursday, the US homeownership rate was 64.3% in 2Q 2018. After dropping to a cycle low of 62.9% in 2Q 2016, the national homeownership rate seems to be on a sustainable upward trend. Compared to the peak of 69.2% in 2004, the homeownership rate is lower by five percentage points.
The count of total households, however, increased to 121 million in the second quarter 2018 from 119 million at the same period in 2017. The gains were predominantly driven by owner households, while renter households only increased 146,000.
Elsewhere, contracts for new, single-family home sales declined in June, falling -5.3% to a 631,000 seasonally adjusted annual rate according to estimates from the joint release of HUD and the US Census Bureau Wednesday.
Despite the disappointing June estimate, total sales for the first half of 2018 (349,000) were +6.9% higher than the comparable total for 2017 (327,000). The US National Association of Home Builders said they expect the volume of new home sales to continue to expand along the current modest pace, subject to monthly volatility and supply-side cost concerns.
Inventory increased in June to 301,000 single-family homes for sale. The current months’ supply stands at a healthy level of 5.7. Given tight existing home inventory, more new homes can be absorbed by the market.
Median new home sales price declined for the third consecutive month, falling to US$302,100. Managing rising construction costs in the months ahead will be a key challenge for housing affordability, as input costs increase, although recent declines in lumber prices should help, said NAHB.
